Molecular dissection of the genes responsible for the formation of the extracellular polysaccharide capsule, the major virulence factor of Cryptococcus neoformans. Cryptococcus neoformans is a pathogenic fungus which most commonly affects the central nervous system and causes fatal meningoencephalitis primarily in patients with AIDS. C. neoformans produces a thick extracellular polysaccharide capsule and it is a well recognized virulence factor of the fungus. In the previous year, we cloned two additional genes, CAP64 and CAP60, associated with capsule formation. This year we have characterized the gene CAP60. Deletion of the CAP60 gene from a wild type strain of C. neoformans resulted in the simultaneous loss of the capsule and virulence in the mouse model. Complementation of a CAP60 mutant with the CAP60 gene isolated from the wild type restored the capsule as well as virulence indicating that the CAP60 gene is also essential for the formation of capsule and in turn for virulence. CHEF gel blot analysis indicated that the CAP60 gene is located on the same chromosome as the CAP59 gene. DNA sequence analysis showed that CAP60 shares some similarity with the CAP59 gene but the biochemical function of CAP60 remains unknown. As was the case with the two previously characterized CAP genes, the CAP60 gene was found to be closely linked to another gene that encodes cellulase. The compact genomic arrangement appears to be common in C. neoformans.